Forecasting Interest Rates On May 23, 20XX, the existing or current
Forecasting Interest Rates On May 23, 20XX, the existing or current (spot) one-year, two-year, three-year, and four-year zero-coupon Treasury security rates were as follows:
1R1 = 5.25%, 1R2 = 5.75%, 1R3 = 6.25%, 1R4 = 6.45%
Using the unbiased expectations theory, what is the one-year forward rate on zero-coupon Treasury bonds for year four as of May 23, 20XX
7.05% 6.45% 5.925% 22.00%